3HR strategies for change A workshop on the human resource aspects of managing change and building organisation effectiveness Jim Cannon and Roger Niven
4The reconnaissance visit Many issues identified as importantEvaluation and assessmentPerformance management and rewardsEmployee developmentHR planning, utilisation and developmentRetentionSelectionWhat next for FIST
6The Development of Strategic Thought After Arto Lahti
7Michael Porter - Forces Driving Industry Competition Potential EntrantsSuppliersIndustry CompetitionCustomersSubstitutes
8McKinsey’s 7- S - Model Shared Values Structure Strategy Skills SystemsStaffStyle
9Total business system to deliver value to customers TechnologyOperational excellenceProduct leadershipCustomer intimacyBusinessProcessesOrganisationCultureManagement systemsTreacy and Wiersema
10An illustration of technical and adaptive work Fosbery FlopStraddleHeightofhighjumpWestern RollScissorsYearsFrom Richard Pascale
11The need to involve people After Rosabeth Moss KanterOnly a few can chooseInfluenceA wider range of experiments and prototypesAn infinite number of very small scale improvements
12“Management’s mandate is to minimise risk and to keep the current system operating. Change, by definition, requires creating a new system, which in turn always demands leadership”.John P Kotter
13Leaders and strategy“I agree … strategy ‘emerges’ … but we are not helpless. Strategy does not simple emerge … it is emergent. By creating the right set of preconditions one can provoke emergence.”“Too often we work on ‘the strategy’, rather than the preconditions that could lead to strategic innovation.”Gary Hamel
14Improving business results through people StrategyPeopleRequirementsEmployeeNeedsCustomerSatisfactionHuman ResourceStrategy:EmploymentRelationshipEmployeeSatisfactionHuman ResourcesPractices, Policies,Programmes
15HR roles in building a competitive organisation Strategic FocusManagement of StrategicHuman resources - aligningHR and business strategy byorganisational diagnosisManagement of transformation-renewing the organisationPeopleProcessesManagement of infrastructure- processes to deliver servicesManagement of employeecontribution - listening andrespondingOperational Focus Source: Ulrich and Conner
17Exercise: Reactions to change Think of a major change in your life:What were the different reactions you experienced?What helped and hindered you come to terms with the change?If it happened again, how would you handle it differently?
18A spectrum of reactions ActiveresistancePassiveresistanceIndifferenceAcceptanceEnthusiasmProtests“Work to rule”ApathyReactiveLoss of interestCo-operation under pressureSupportiveEnergyIdeasSlow downIntentional errors4.11
19Complex forces of change Restraining forcesDriving forcesForces come from:outsidethe organisation itselfinternal groupsindividualsLewin4.7
20Individual responses to a new reality : The Transition CurveHIGH7.ConsolidatingClear insight into newreality. Consolidationof new behaviours.6. DevelopingSearch for clarity.Developing effectiveways to respond tonew reality.2. RejectionRejection of new reality.Defence of existing initiatives.Detail of problems.False sense ofcompetence re-established.PERCEIVED COMPETENCE3. UncertaintySense of anxiety/incompetence.Frustration.Uncertainty about howto deal with new reality.5.ExploringTesting new behaviours,new approaches.Lots of energy, angerand frustration.Beginning to dealwith new reality.1. SurpriseImmobilisation.Shock, surprise oranger at mismatchbetween high expectationsof performanceand the new reality.4. AcceptanceAcceptance of newreality.‘Letting go’of the past.Attitudes andbehavioursre-examined.TIMELOW
22The Levers of Change Self awareness (Do I understand what I need to do differently?)Will (Do I want to change?)Competence (Am I able to change?)Conscience (Is the change congruent withmy beliefs?)Pleasure / Fear consequences (Will I benefitor suffer?)Vision (Is this change in line with I wantfor the future?)
23The stages of change (J Kotter) Establish a sense of urgencyCreate a guiding coalitionDevelop a vision and a strategyCommunicate the new visionEmpower employees with broad based actionGenerate short term winsConsolidate early gains but push on for more changeAnchor new changes in the culture
24Activities for successful change management Avoid over-organisingProvide help and support Communicate likenever beforeManagingEnsure early changeinvolvement work at gainingCommitmentTurn perceptions of threats into opportunities
25‘Crazy time’ Old New ways ways of of doing doing things crazy time thingsStart of change ‘end’ of change
26When to change? “The second curve” Relative performance Extra work UncertaintyFight for resourcesTime4.9Handy
27Who helps and hinders change? SeniorityLow Influence on change High
28Looking for the positives in any change ‘I learnt something’‘I won’t make the same mistake again’‘I was more fortunate than some’‘Today is the first day of the rest of my life – I can choose to let the past go’‘I cannot change history, but I can steer a different path into the future’
29Group discussionWhat change strategies have worked successfully for organisations represented here today?
32Structure of a credit card company. A division of a bank Management %Middle level staffJunior staffAgencyTotalSource: Published accountsBarclaycard. Note the large agency staff.Promotion rate to management is about 7:1
33Constructing a Human Resource Plan Corporate plans/objectives+Sales / OutputForecastsfeedback & review- changes in utilisation- changes in demandH.R. DEMAND SCHEDULEquality & quantityH.R. PLANRecruitment(input)Training & Retraining(change)Retirements / Dismissals(output)feedback & review- external labour supply- changes in wastage ratesH.R. SUPPLY SCHEDULEquantity & qualityAnalysis ofexistingH.ResourcesWastageForecasts+
34What are the drivers of staff numbers in your business? Staff CategoriesKeyDriversNotes:2.9
36Productivity measures ActivityOutput/ person (What drives activity?)ValueCost or Revenue/person costOpportunityMaximum value produced/hour – actual value produced/hourNote: Consider the effect, attendance and efficiency
37Productivity improvement Job analysis‘Bottlenecking’BenchmarkingSuggestion schemes (staff and customers)Trend analysisZero based budgeting
38Using activity analysis in the European Commission – a case study Question posed: How many career counsellors were required?Model created to structure assumptions and see the impact of changed circumstances.Set agenda to track actual effectiveness and to clarify more realistic assumptions.
40Scenario planning Key Steps: determine scope and timeframe of project identify current assumptions and mind-set of decision makerscreate alternative, plausible scenarios of how future may evolve, identifying key assumptions and decision pointsconsider drivers of each scenario
41Scenario planning cont’d... test impact of key variables in each scenariodevelop action plans based upon:the most robust solutions across all scenariosstrategies that leave options open until most-likely scenario is clearcritical decisions affecting most desirable outcome
42Scenario planning Today Future Project plan Future scenario A Today’s EnvironmentFuture scenario BFuture scenario CProject planDate /9 6/9 1/9 6/9 1/9 6/9 1/9 6/9Project 1Project 2 Scenario A or B Scenario AProject Scenario BProject Scenario CSignpostsDecision Points
43The Texology call centre an case study on planningReview the notes and information supplied.In groups, consider the questions asked.
45Career Development Planning assessing skills & competenciesperformance management processespsychometrics360° feedbackassessment / development centrescareer counsellingre-trainingjob changessecondment
46Career review 1. Personal stock take State: experiences, interests, abilities, motivationExplore: feelings, e.g. boredom, no challenge, outdated skillsConsider: strengths, abilities, likes personal qualities2. Personal requirements for the futureare skills being properly utilisedwhere might they be better employedis job enhancement a possibility?
473. Consider alternatives in company - different departmentsspare time occupationother companies in same sectorchange of occupationanalysis of the market place4. Plan of actionnew horizonsjob search strategyskills updateself - marketing
49What do I want to do? Same work Different work New sector Same sector Moderate riskResearch?Low riskJob seeking?SameworkHigh riskLong term?Moderate riskRetraining?DifferentworkNew sectorSame sector
50Tools for improving utilisation Competency frameworkSkills transition matrixSuccession planningHuman Resource Plan templateSee Jeronimo Martins competency frameworkCharterhouse skills matrixUnilever template
51Skill Transition Matrix Into Job AInto Job BInto Job CEntry LevelBasic requirements;Qualifications,experience,competencies(% who will remainin 1 year, 3 years)Ongoing training toAdditional skills,From Job Amaintaincompetencies.satisfactoryTime to retrain,performance(% likely to do job)From Job BAdditional skills,competencies.Time to retrain,(% likely to do job)
53Succession Planning - Ratings Performance Rating:A - ‘exceeds expectations’B -C - ‘satisfactory performance’D -E - ‘unsatisfactory performance’Promotability Rating:1 - ready now2 - likely to be ready during next 24 months3 - not ready for promotion
54Career Development Records Minimum information required:1. name & present position2. date assigned to current job3. latest performance rating4. Promotability rating5. target date for expected move6. actions required to prepare for (5)plus record of training / development actions
55Career & Succession Planning Problems And Issues the ‘Prince’ and the ‘Pauper’people are unpredictableplanning and the forced choiceplanning and the self-fulfilling prophecyprediction in a world of changeperformance v potentialexpectation and ambitions‘as is our confidence so is our capacity’opportunity and its predictionthe politics of judgementpotential for what, in growth and decline
56What should follow the FIST programme for FIST participants?
57Company groups Review the work we have done today Identify any aspects that may be applicable to youDiscuss any actions you need to take to introduce these ideasWhat further do you need to know from the tutors and others to take these ideas further.
58Welcome to day 2 What were the key points for you from yesterday Any queries and questions?
60How do we get people to perform? SituationPerformance
61How do we get people to perform? SituationVision Behaviour CultureMission and goals Group feeling PoliciesStrategyStructure Needs ProceduresSkills FreedomPerformance
62Balanced scorecard an example from an international bank FinancialMaximise SVA over timeClientsMarket leadershipProduct excellenceOutstanding customer serviceProcessesWorld class efficient processesStrong preventative and detectivecontrolsKey performance indicatorsInnovation and continuousimprovementVision andStrategyPeopleStrong leadership teamHigh quality people at all levelsDiversity, fairness and opportunityCommitment to employee success
63Measures Financial – share price, Price/ earnings, ROCE Clients – Market share, product comparisons in focus groups, service failures, customer surveysProcesses – Benchmark comparisons, mistakes, performance against Key Performance IndicatorsPeople – Absence, turnover, attitude surveys, upward feedback
66A model of good selection Define the job to be done – the job descriptionSpecify the ideal candidate – the person specificationTechnical experience and knowledgeBehavioural criteriaDefine the selection methodAttract suitable candidatesAssessAttract, appoint and induct
67Selection methods Application form Interview Competency based Panel interviewTestsGroup discussionReport / presentationAssessment centresTests can be of knowledge (typical professional exam), situational (What would you do if..)Assessment centres combine tests, interviews, in basket ( inbox), panel discussion
68Assessment – a banking example Exceeded performance standard 29.3%Met standardFailedSource: Monthly HR statistics
70Controlling Labour Turnover expect labour wastagereduce its impactbe competitive in labour marketemphasise areas of satisfactionreduce areas of dissatisfactionanalyse reasons for turnoveruse feedback to change management systems / practices
71Some Factors Affecting the Decision to Leave Reference groupbehavior.Value system,performancefeedback. Paystructure.Chances ofpromotionexpectations,knowledge ofotheropportunities.TemporarilycommittedReason forjoiningAge,grade,length ofservice,skill type;levelNeeds and satisfaction = Needcontribution balanceIndividualjoinsUn-decidedMorepermanentcommittedMale/Femalemarital statusDecisionto leaveCritical factor‘Last Straw’ExternallabourmarketIll health & deathretirementfinancial inducementTermination
72Employer Influence On Labour Turnover most firms areACTUALLYherebut….THINK theyare herehighInternal labourmarket causesEMPLOYER INFLUENCEExternal labourmarket causeslowBevan 1988
73Tactics for Reducing Turnover be the best in townwork hard at labour retentionpilot schemesestablish positive role modelsresearch where staff come fromallocate v select/rejecttrain and retrainrestructure workcareer pathing
74EXIT INTERVIEW - COMPANY CASE STUDY A SURVEY OF 177 PEOPLE WHO LEFT OVER A SIX MONTH PERIOD 5.15
76Training needs analysis Desired performance minus Actual performanceGapTraining need Non-training need
77Non-training factors affecting behaviour / performance OrganisationPersonnel practicesJob designSupervisionEnvironmentInformation systemsNon-work problems and worriesFor exampleOrganisation. E.g. where work is not organised in an efficient manner, does not flow in a logical sequence from one job to another, unclear responsibilities.Personnel practices e.g. unfair pay systems, unnecessary rules and restrictions on freedom to actJob design e.g. too much to be done in the time availableSupervision e.g. poor motivational approach – instils defensive behaviour through fearEnvironment e.g. inefficient equipment, layout of work place, too hot /too coldInformation systems e.g. insufficient, inaccurate or out of date data.Non work problems e.g. divorce
78Some current ideas Leadership is for all Skills, behaviours, beliefs Leadership is about:BehaviourCoachingEmphasis on vision and valuesReading situationsMentoringSelf-awareness360 feedbackChoicesManagement of time and attentionSartre – we create our values through the choices we make. Walk the talk.Mandela,GhandiWho are the leaders? - everyone
79Strategies for matching how we learn to needs at different levels Activist Theorist Reflector PragmatistOrganisationEvents Presentations Visibility of Practical supportConferences on strategy senior managersTeam Team problem Goal setting Observe experts Able to experimentsolvingIndividual Learn by doing ‘why do I need to Coach/mentor flexibility to findknow that or do it?’ the best way for meNWW – annual company conference- participation about the strategy and opportunities to quiz senior managers
80Company groups Review the work we have done today Identify any aspects that may be applicable to youDiscuss any actions you need to take to introduce these ideasWhat further do you need to know from the tutors and others to take these ideas further.
81Roger Niven and Jim Cannon Thank you for comingRoger Niven and Jim Cannon